Controlling costs is difficult in a growing business.  Your company culture can impact your success in managing costs find out how.

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Show Notes

Trying to control and manage costs is always difficult in a growing business.  Your company’s culture can affect how your organization approaches spending and cost control.  As a business owner who wants employees to “think like an owner”, he or she needs to set the example when it comes to managing costs in the business.

Key Points

*Cutting costs in bad times are evidence that a company doesn’t regularly manage and monitor costs.

*Companies sometimes treat cost cuts with an “anything and everything” approach. Lisa refers to the ax approach.

*When companies make cost reductions, they need to take time to understand the impact of cuts on the business.

*Regularly monitoring financial information and managing costs can help avoid some those types of approaches to cost control.

*Keeping some perks or nice-to-haves at the expense of essential costs sends a bad message to your staff.

*Having select people in the company responsible or only certain areas impacted by cuts can also have a negative impact.

*Ignoring long term savings opportunities is another way entrepreneurs can get cost control wrong.

*Culture is a company’s approach – what it believes, values, and how it behaves to get work done.

*Culture can influence cost control both positively and negatively.

*Lisa explains how bias can impact how you approach costs and also impact the culture as well.

*Process improvement initiatives with a teamwork approach can benefit both culture and cost control efforts over the long term.

*The entrepreneur can positively impact a cost focused culture by being consistent in the way he manages costs and reinforce cost conscious behavior.

*Creating a cost conscious culture – or any cultural attribute – entrepreneurs need to make sure that it lines up with his or her own beliefs, behaviors and values and lines up with his or her actions.

Resources and Links

Struggling with this in your own business?  Set up a Quick Care Consultation with Lisa Roberts here

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Get all the updates and information Lisa shares from Business Rx and the Healthy Business Healthy Profits show! You’ll get information, tips and strategies on growing a healthy successful business. Don’t worry, I won’t bombard you with emails.  At most, you’ll get something from me every few weeks. You can sign up  Here

Lisa Roberts is a business operations consultant who advises growth company entrepreneurs in successfully managing growth and the challenges they face along the way. She has over 25 years of experience in operations, finance and administration and spent several years in executive roles at a high growth company. She recognizes that there is a fine line between success and failure in a growing business and that entrepreneurs need to focus on managing finances, creating a sound operation and employ good business practices to stay on track.   You can find out more about her here

Ever been faced with a problem in your business?

Sure we all have!

Some problems are straight forward others more perplexing.   Ever think about what can be “at play” when problem solving in your own business?

Let’s face it, sometimes we’re just too busy to be faced with yet another new problem because we as business owners just need to get past it. We need to relieve the tension, frustration and just make the thing go away. But we know that can be a little dangerous because coming up with the quick fix may not be the right fix.

Did we know what the core root of the problem really was before we decided to implement that quick fix?

What gets in the way of good problem solving?

There are a lot of things that can get in the way of good problem solving and many of them have to do with people and mindset.

You know the old saying that goes a little bit like if all you have is a hammer you see everything as a nail. There is bias, mindset and even feelings that can go into trying to solve a problem.

In your business you have people; people that may have preconceived notions about the situation you’re facing. You may even have them too!

Let’s take the company that has a lot of politics and hidden agendas that swirl around.

Do you think that is a good environment for problem solving? Me neither.

Culture plays a role

Your business culture can play a big role in your success or failure at solving problems. That political/hidden agenda company, they’ll have a hard time getting to the true root cause of problems. Protecting their turf or attempting to place blame elsewhere will certainly cloud the picture when you’re trying to get to the root cause of a problem.

How about the company that doesn’t foster good communication? They too will struggle to solve problems. If you and your management team don’t ask questions and encourage honest feedback, how will you begin to understand what’s gone wrong?

Teamwork can affect problem solving

It’s easy for a company that grows to begin to struggle with teamwork. As you become a larger company, you’ll have departments with department managers and the silos can begin to form. No matter how you break down your company into departments, they will still need to work together as a team. Coordination across departments becomes much more important as you grow!

That coordination becomes even more difficult as each individual department has its own goals and priorities that may compete with other departments. When faced with a problem that involves multiple departments, a lack of teamwork and cross-departmental cooperation will make solving the problem much more of a challenge.

Bias plays a role

Think about the hammer and nail quote.   There was a bias because of the tool the person had. The same can be said for bias based on your background, your specialty and even your past experiences.

I’ll tell you a quick story that might illustrate this better. It happened to me a few years back.

A business colleague who was a builder bought a double lot property that she wanted to split into two lots.   The problem was the existing house was built in such a way that it was too close to the property line of the other lot where a new house would be built.

The architect and the builder looked at the problem through a pure construction lens and decided that they need to pay to have the house raised and resituated on the lot. The amount to perform that task was tens of thousands of dollars. They thought they had no other choice.

I had walked by that house several times while walking my dog. The builder asked my opinion. I came at it from my perspective, a practical person with a business background. I asked a simple question, what is the room that stood on the property line? It was a sunken living room that she noted wasn’t necessarily “in style” any longer. So I asked why don’t you just chop it off and add a room in the back.

It was a simple question but one that from their point of view they never considered. In the end, that’s what they ended up doing because it made more sense from a cost standpoint and an aesthetics standpoint.

The moral of the story is that sometimes bias and viewpoint can get in the way. Seeking out differing views from different angles can find a solution to a problem that might otherwise be missed.

8 Ways to foster better problem solving in your business

Here are a few things to keep in mind when trying to solve problems in your own business.

  1. Foster honest communication in your business to get input.
  2. Be aware of “hidden agendas” and be sure that you squash those with open minded communication and culture
  3. Be cognizant of biases – seek differing opinions both inside and outside your company.
  4. Ask questions – challenging, thoughtful questions can open minds as well as mindsets.
  5. Resist the quick fix – don’t let the tension of the problem make you fix the wrong problem 
  6. Foster and reward collaboration – both among team members and across departments.
  7. Create a safe, open culture – encourage feedback and participation and eliminate fear and judgement.
  8. Don’t forget the big picture – having too narrow a focus in problem solving can lead to fixing one problem, but breaking something else in your business operation.


Business owners need to resist the urge to “just make problems go away”. Create a company and culture that gets the root of your business problems to make sure that you are truly fixing the right problem.